Conductor purchase price revealed: $15.8M cash + $97.8M stock
$113 million. The Conductor deal, it turns out, was done for $15.8 million in cash and $97.8 million in Series AP-1 Preferred Stock, for a total transaction value of just over $113 million, which is not a lot considering Conductor raised roughly $60 million. That compares to independent SEO firm BrightEdge which has raised nearly $62 million.
Here’s a relevant excerpt from the WeWork S-1 filing:
In March 2018, the Company completed the acquisition of 100% of the equity of Conductor, Inc. (“Conductor”) for a total consideration of $113.6 million. The total consideration included $15.8 million in cash and $97.8 million in Series AP-1 Preferred Stock. As of December 31, 2018, $0.2 million of cash and $10.0 million of the Series AP-1 Preferred Stock that were held back at closing remain included in other current liabilities and additional paid in capital, respectively on the condensed consolidated balance sheet. As of June 30, 2019, all holdbacks have been released and the Company received $0.2 million as a purchase price reduction, which was recorded as a measurement period adjustment to goodwill. Conductor was founded in 2006 and is a marketing services software company that provides search engine optimization and enterprise content marketing solutions.
A ‘big win’ — we’ll see. When the Conductor deal was announced, Conductor CEO Seth Besmertnik said it was a “huge win for the entire industry.” That still remains to be seen.
The vision for
Still, the mostly stock transaction could pay off nicely for Conductor. We’ll have to see what investors’ appetite is for The We Company.
Uber, the most recent tech-company IPO, has had a tough time so far, with investors now deeply skeptical about the long-term outlook for the company. Uber’s performance could dampen demand for We, especially in the larger context of fears of a coming recession.
Why we should care. The SEO industry has a lot of companies that are seeking to be acquired or exit in the next few years. Conductor’s acquisition price could establish a benchmark that would-be buyers use to value other companies.
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